In this article we will discuss Wage Rules and how they are used in Time Portal.
A wage rule is a record that defines a set of parameters that control how your time data is processed when it is exported out to payroll.
A wage rule is a record that is used when exporting payroll that defines things such as minimum wage rates and also how overtime pay should be calculated. Typically, you will have a wage rule for each state you work in.
If you work in only one state, wage rules are not necessary. Time Portal can be used without them and is typically recommended. Wage rules are an advanced feature of Time Portal.
Do I need to use a wage rule? If you answer yes to any of the below questions, then yes, you should probably use a wage rule.
Do you pay overtime? Do you work in multiple states at a time?
For example, wage rules control if and how overtime is applied.
In this article we will learn:
- What is a wage rule and do I need to use one?
- Wage rule anatomy.
- How to setup a wage rule
- How wage rules are applied in the system
- How to use a wage rule when exporting payroll
How to Configure and what are the capabilities of a Wage Rule
Let's start by navigating to the Wage Rule page by clicking Lists > Wage Rules.
1. Now let's see how to create a new Wage Rule record by clicking on the Create Wage Rule button. A popup window will display the properties that the Wage Rule provides us. Let's review what the properties are and how they can help us.
- Name - The name of the wage rule is how you can identify the rule throughout the software. It is recommended that you name the rule something that identifies what the rule is used for. An example would be that you could have wage rules for each state that you work in. Each state typically has different minimum wage rates and overtime requirements so specifying a rule for each state is a great way to identify what the rule is for and what it does.
- Minimum Wage - the minimum wage field is the minimum wage that will be used when calculating minimum wage makeup pay for DOMESTIC workers. Time Portal determines if the worker is domestic by checking that the "Is H2A" field is FALSE on the employee record.
- H2A Minimum Wage - this is the minimum wage field that will be used when calculating minimum wage makeup pay for H2A workers. Time Portal determines if the worker is domestic by checking that the "Is H2A" field is TRUE on the employee record.
- Is Active - (only appears on an existing Wage Rule) this determines whether the wage rule is active or not and controls if the rule is available for use throughout the software.
- Overtime - overtime allows you to turn on overtime in the software. We can specify three different types of overtime pay and have complete control of how it is configured.
- the first option allows us to define the multiplier of regular pay to be paid after a specified amount of hours in one day. An example would be that we are paying 1.5 x Regular Pay after 8 hours daily.
- the second option allows us to define extended pay in the same manner. An example of extended pay would be 2.0 x Regular Pay after 12 hours daily.
- our last option allows us to define the multiplier of regular pay to be paid after a specified amount of hours in one week. This is the more standard overtime option where we can specify 1.5 x Regular Pay after 40 hours weekly.
- Break Pay - Break Pay allows you to define rules for additional pay based on number of hours worked.
- the first option allows us to define the number of minutes to be paid after a specified amount of hours. An example would be that we are paying 15 minutes of break pay for every 4 hours worked.
- In the example, the worker must work at least 3.5 hours daily and hours are rounded up at 2.1.
How wage rules are applied in Time Portal
Now that we know what a wage rule is and what it can do, let's see how they are applied in Time Portal. Wage Rules get applied on the Time Sheet. This tells the payroll export that the data associated with that time sheet should be processed with the rules defined within that time sheet's selected wage rule.
Once we have a wage rule created, we can then begin to utilize it. If we look in the upper section of the time sheet screen we will see a wage rules field. Here we can select the appropriate rule for that time sheet.
There are many different ways you could configure your wage rules but, to provide a simple example we could say that we have two crews working. Crew A is working in Florida and Crew B is working in Georgia. We could have two wage rules created, one called Florida and one called Georgia. When the crews' time sheets are uploaded to the website, we can select the appropriate rule to be applied for each crew based on where they are physically working. When these time sheets get exported out to payroll, they will be processed using their selected wage rule.
Above is a simple example of how to apply wage rules to time sheets and why. However, manually selecting wage rules for each time sheet can become tedious and error prone when working with large amounts of crews and employees. Time Portal offers us a way to automatically assign Wage Rules based on predefined configurations. Let's take a look at how this works. Just like with the hourly rate hierarchy Time Portal can determine the appropriate Wage Rule based on our typical latter structure. If we navigate to the company page, we can select a default wage rule that will get applied to all time sheets. We can also select a default wage rule for a specific crew by navigating to the Crew setup and modifying a crew. The crew record allows us to select a wage rule to associate with them. When a time sheet is created or uploaded to the website, Time Portal will look at the Crew record to see if it has a default wage rule. If it does, it will set the wage rule to its default value for that crews time sheet. If the crew does not have a default wage rule, Time Portal will check the company to see if it has a default wage rule. If it does, it will use it, otherwise the wage rule can be manually selected on the time sheet as mentioned in the example above.
How to use a Wage Rule when exporting payroll
Once we have our wage rules applied to our time sheets. The payroll export can then utilize them when exporting the time sheet data through our chosen payroll provider. When utilizing wage rules, we must at least export each wage rule in a separate batch. Each batch is processed based on that particular wage rule. As an example, when we select our date range and crew(s) on the payroll export screen, we would also select our Florida rule based on our previous examples. This would pull all time sheet data within the given date range, the selected crew(s), and time sheets with the Florida wage rule selected. We would then need to process the Georgia wage rule afterwards. This is required because each wage rule provides different rules for calculating the data appropriately and keeps them separate by batches. Its important to know that if our time sheets do not have a wage rule associated to them, we would leave the wage rule selection blank when exporting payroll for those records.